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It seems that most people are shopping deals for bragging rights rather than buying a home.
I don't think you understand the gravity of the situation. Buyers used to make sacrifices in selecting what to buy. Now they make sacrifices in how long they have to wait for what they want to become affordable. It's all one big game of chicken with the odds stacked in the buyer's favor. With an increasing variety and quantity of housing options becoming available, the buyer no longer has to sacrifice that large lot, garage, or hardwood floors. Today's buyers don't want to be saddled with the mistakes of the bubble-buyers and equity-ATM'ers now scrambling to sell for top dollar. Rising defaults, redefaults, and impending Alt-A and Option-ARM resets make things even worse.
Given that the NAR reports most houses are selling for 89% of their asking price, an initial offer of 94% is outstanding. As a buyer, if I put that kind of offer out on a house I'd absolutely expect you to immediately accept it. If you don't accept it then I can just pick another one of the many options out there on the market. Your house isn't special to someone looking in from the outside. To the seller it's a home, but to the buyer it's just one of many options. It's just another stack of timber on a lot. In putting in a 94% initial offer the buyer is doing you a favor because the next buyer likely won't put in such a high offer. If you want to play games and do the back-and-forth, then the buyer might as well just deal with a bank.
The current market is a numbers game. Very few people are in for the thrill of a good deal (seriously, who does that outside of Wall Street?). Many house flippers have been burnt to a crisp. Those buyers with good credit can see the historical pricing statistics and worsening economic forecasts to plan accordingly. What is considered a "steal" today used to be nominal pricing in the beginning of this decade.
It is also a matter of coming from another market by losing money on initial home sale and trying to do the stats to recoup some of the loss. Not to be ugly but reality of situation. Thinking I would have more money to put down on the new home and not. What do you do?
Plus banks are a tighter bunch now with lending money of course.
Plus looking at all the internet graphs and such and comparing the future resell value and some of them totally are opposites. Hard to feel safe enough to even buy at all again so trying to be very conservative and not mean. Knowing how it feels to a homeowner to have to sell lower than expected, believe me.
Nearly impossible to find foreclosures online and not have to pay for the privilege. This is what ticks me off the most. Should be illegal IMHO.
Overwhelmed.
I don't think you understand the gravity of the situation. Buyers used to make sacrifices in selecting what to buy. Now they make sacrifices in how long they have to wait for what they want to become affordable. It's all one big game of chicken with the odds stacked in the buyer's favor. With an increasing variety and quantity of housing options becoming available, the buyer no longer has to sacrifice that large lot, garage, or hardwood floors. Today's buyers don't want to be saddled with the mistakes of the bubble-buyers and equity-ATM'ers now scrambling to sell for top dollar. Rising defaults, redefaults, and impending Alt-A and Option-ARM resets make things even worse.
Given that the NAR reports most houses are selling for 89% of their asking price, an initial offer of 94% is outstanding. As a buyer, if I put that kind of offer out on a house I'd absolutely expect you to immediately accept it. If you don't accept it then I can just pick another one of the many options out there on the market. Your house isn't special to someone looking in from the outside. To the seller it's a home, but to the buyer it's just one of many options. It's just another stack of timber on a lot. In putting in a 94% initial offer the buyer is doing you a favor because the next buyer likely won't put in such a high offer. If you want to play games and do the back-and-forth, then the buyer might as well just deal with a bank.
The current market is a numbers game. Very few people are in for the thrill of a good deal (seriously, who does that outside of Wall Street?). Many house flippers have been burnt to a crisp. Those buyers with good credit can see the historical pricing statistics and worsening economic forecasts to plan accordingly. What is considered a "steal" today used to be nominal pricing in the beginning of this decade.
Oh, I think I understand the gravity of the situation, and also the dynamic of people placing more emphasis on "a great deal" rather than getting a house to live in.
I work with buyers and sellers every day and see the concerns they all carry.
If it is "just a stack of timber on a lot," and not a home, why would buyers not just save time and write an offer on the first property they see? Or the second?
Why do they need to look at 10, or 20, or more all in the same price range if they are all the same?
I think there is a little more involved than just a stack of timber.
Oh, I think I understand the gravity of the situation, and also the dynamic of people placing more emphasis on "a great deal" rather than getting a house to live in.
I don't see why anyone would not want a great deal given where the housing market is going. Why in the world would anyone want to pay $300k for something that will be worth $250k in a matter of months? Today's great deal is next month's good deal and next season's average transaction. With the economic outlook so grim, mounting unemployment and global financial crisis, everyone wants to think they got a great deal. That's why the emphasis is on finding deals. Nobody wants to be underwater or to overpay in a declining market. Nobody wants a bad deal or average deal when they have to pay so much in commissions, fees, and taxes.
Quote:
Originally Posted by MikeJaquish
If it is "just a stack of timber on a lot," and not a home, why would buyers not just save time and write an offer on the first property they see? Or the second?
Why do they need to look at 10, or 20, or more all in the same price range if they are all the same?
I think there is a little more involved than just a stack of timber.
The "stack of timber" comment was in the context the seller's home being one of many changing options on the market. Most sellers think their place is special, but there's a lot out there for buyers to choose from right now. If one buyer won't play ball there's another that will.
You all do remember those builders who had "lotteries" for lots in California, South Carolina and other places in '03, don't you? And basically all realtors were raking in the dough.....tons of homes sold meant tons of commission.....Not one PEEP for potential buyers who were priced out of the market......no one gave a rats about them.
It was only 5-6 years ago, but seems like a lifetime...right guys?
Now, everyone on the selling side is crying the blues. Sellers, realtors, builders, NAR, you name it...trying to throw everything including the kitchen sink to keep home prices from falling further.....FINALLY, qualified buyers who sat tight are licking their chops (deservedly so).
It really sucks when your on the other side, isn't it?
I don't see why anyone would not want a great deal given where the housing market is going. Why in the world would anyone want to pay $300k for something that will be worth $250k in a matter of months? Today's great deal is next month's good deal and next season's average transaction. With the economic outlook so grim, mounting unemployment and global financial crisis, everyone wants to think they got a great deal. That's why the emphasis is on finding deals. Nobody wants to be underwater or to overpay in a declining market. Nobody wants a bad deal or average deal when they have to pay so much in commissions, fees, and taxes.
If someone wants to sit on the sidelines, they certainly have that right. No one should enter a market that intimidates them.
Quote:
Originally Posted by BigDragon
The "stack of timber" comment was in the context the seller's home being one of many changing options on the market. Most sellers think their place is special, but there's a lot out there for buyers to choose from right now. If one buyer won't play ball there's another that will.
Actually there was little context in the paragraph. It was BS as presented, but now that the context has changed, it becomes more interesting.
The timbers need to be analyzed.
I work with Buyers more than Sellers currently, and take seriously helping them find value.
Buyers have a lot of choices? You should see the choices my typical Buyers enjoy. Visit 20 homes at any price point. Disqualify 18 of them. Two choices left. And one is questionable. And the other is just to have one to play with.
That is not uncommon.
See, the stuff that sits on the market forever is typically junk in any market, and just moreso now.
Good stuff sells fast enough.
Buyers who desire only a "great deal" have that right. Most folks need to consider additional parameters besides list price and theoretical discounted price.
For many folks, quality is an issue. Floorplan is typically an issue. Schools, neighborhood amenities, lot size, proximity to employment centers, environmental impacts all figure in.
The narrowly focused bargain hunter who actually needs a home often loses 2 or 3 to someone else and settles for less or pays more because of blinders to the fact that NAR, CNN, CNBC, and other drooling and panting pundits' national numbers are commonly irrelevant to local market conditions.
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